USDA stops support for Farm-to-Fleet biofuel production incentive

By Erin Voegele | February 05, 2018

The USDA Commodity Credit Corp. has withdrawn support for the Farm-to-Fleet biofuel production incentive (BPI), effective Feb 1. BPI payments, however, will continue to be made under existing commitments.

The CCC published a notice in the Federal Register Feb. 1 announcing the decision, which is effective immediately. The notice explains that the USDA has reassessed how to best use limited available funds and has determined that the BPI is no longer a priority for CCC funding. According to the notice, the impact of the action is that supplies of fuel containing a biofuel blend to the Navy are no longer eligible to receive CCC incentive payments through the Farm-to-Fleet BPI program.

The CCC indicated that a notice of funds available for the Farm-to-Fleet Feedstock BPI was released in December 2016. The payments were intended to support the Farm-to-Fleet Program, launched by the USDA and Navy in 2013. The program was designed to provide incentive funds to companies that are refining biofuel in the U.S. from certain domestically grown feedstocks converted to drop-in biofuel for delivery to supply biofuels to the Navy.

CCC funds, administered by the Farm Service Agency, were used for BPI payments. Up to $50 million in CCC funds was previously announced as being available through fiscal year (FY) 2018. The notice published on Feb. 1 withdraws the availability of BPI payments for deliveries not yet solicited or procured by the Navy and Defense Logistics Agency Energy office. It also cancels USDA support for biofuels blends solicited by the DLA Energy office and Navy.

The CCC said the FSA will continue to make BPI payments required under existing commitments. In addition, BPI payments will be made from any awards on solicitations issued prior to Feb. 1, but not those published after the withdrawal was published.